If It’s Free, You’re the Product

I wrote a post about free apps some time ago that needs updating – and Kerri shared our point of view just last week on CNBC.  Basically, we all love useful free apps on the web and the tradeoff we’re making is clear.  We’re all fine with using social media apps knowing they make money by serving ads in our feeds.  It’s worth it because let’s face it – you know it’s an ad and you can just disregard it (and most of us do).  The app’s usefulness is still all there.  There may be a concern you might have about your personal social life being used to serve you ads (the creepiness factor) but generally most people aren’t that worried.  Who cares if Instagram knows you like blue clothes?  Sort of harmless.

So what about the big free financial apps like Mint or Credit Karma?  Now this is where you should be worried.  You’re not uploading pictures showing your preference for blue clothes with these – you are connecting your MOST private financial life to them – your bank accounts, credit reports, sometimes even your tax returns.  This is super-private, super-valuable intel.  And they make money by making YOU the product.  They sell access to you and your financial identity to credit card companies, bankruptcy attorneys, insurance carriers, banks, pretty much any company willing to pay them.  But these ads often look like “advice”.  You know an ad for a blue sweater is just a sweater you won’t likely buy.  But when an ad says “you can save money with this credit card!” it looks like something that is actually “tailored” for you.  WRONG.  In fact these products can make your financial life worse, not better.

So if you love Mint what do you do?  Keep using it!  If budgeting is your thing Mint is great.  Just DO NOT pay any attention to anything looking like “advice” that offers a product.  Just put it out of your mind.  What it means is that a big bank or other company has paid Mint to offer that ad to you using your personal information and it is likely the last thing you should be doing.  It isn’t like banks have your best financial interests anywhere on their radar – and neither does Mint.  It’s just business to them.

And if you don’t use them, or are sick of seeing random alerts about spending or your credit score, just de-link them.  It makes zero sense to keep giving access to your financial identity if there’s nothing you’re getting out of it.  Most people are sick of budgeting that doesn’t work, or credit alerts that are just ads for other stuff, so just shut ‘em down.

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